Bitcoin Price Rises as Catalonia Asserts Independence
After the clash between Spanish officials and Catalan over the weekend, the resultant rise in the price of bitcoin has left many debating whether the cryptocurrency could be used as a tool for financial liberation. The cryptocurrency gained in light of the events in Spain, serving as a safe haven for investors exposed to euro-denominated instruments and the European stock markets.
The Catalan Referendum
The Spanish government attempted to violently block Catalan voters from voting on Sunday afternoon through physical force. Images of state police attacking civilians, firefighters, and any other citizen trying to participate in the region’s referendum flooded news feeds. According to one citizen, who has requested to remain anonymous, this was simply a more aggressive example of what has been going on for much longer.
She told BTCManager that, “[State officials] tried to stop the ballot papers [from] being printed…Look [at] Barcelona news [from] seven to ten days ago to see when this all kicked off.” The Spanish government was reported to have invaded printers and schools looking for ballots and arresting people who were involved in setting up the vote.
On September 15, Reuters outlined a measure put in place by the Spanish government to freeze Catalan finances leading up to the independence vote. After declaring the vote illegal, the measure was put in place in order to ensure that state monies were not being used to finance the referendum. Budget Minister Cristobal Montoro told Reuters that, “the Catalan authorities could not be trusted to spend the money on public services rather than the planned Oct. 1 vote…[thus]…The central government will take over the funding of most essential public services in the region.”
Julian Assange Proposes Bitcoin and Monero as Solution
Julian Assange hashtagged “Monero,” “Crypto,” and “Bitcoin” in a September 17 tweet, alluding to the currencies use in evading financial censorship in the region. The capacity for each of these cryptocurrencies to navigate around state-sponsored financial systems is quite clear, but the scalability poses challenges.
Moreover, citizens of Catalonia may not be entirely interested in an economically-driven independence movement. Sources explained to BTCManager that, “[Catalan] wants political and cultural independence from Spain. The continuation of the Euro is a vital part of maintaining some structure in already turbulent waters, so trying to change that would just make things worse.”
Though it has been touted as the new “gold” during economic instability, the advancing political storm in Spain may stick to more traditional economic tools for the time being. Despite adoption in India and Venezuela, the introduction of a cryptocurrency into a mainstream market like Spain’s, specifically Barcelona, would be more challenging.
Barcelona’s History of Blockchain Use
The city does, however, have a history of experimenting with blockchain technologies as well as the mayor even proposing the use of a city-wide voucher. The voucher, although seemingly dissimilar to cryptocurrencies, does introduce a currency exclusive to the city. Officials explained that the “digital model…will incorporate a rechargeable credit card type identification and will allow those who adhere to operate in the city with a payment system through the internet and mobile devices.” It was proposed as a part of the European project Digipay, through which the city has received 132,000 euros ($155,272) since 2015.
As the housing market grows more and more competitive, Airbnb and similar services are also coming under greater scrutiny. The opportunity to introduce smart contracts in this market has interested a handful of residents. Another citizen reported that Barcelona could be a “proving ground for smart contracts on rentals, and/or local Airbnb-type services built within the Ethereum ecosystem…[moreover]…An independent Catalunya, depending on the resistance and problems from the Spanish state, could be a fantastic place to test out scaling and feasibility for all sorts of projects. It’s a population of 7.5 million, which is a great sample.”
Ultimately, it will be up to the citizens of Catalonia to determine how best to navigate their sovereignty. The difference between media sensationalization and what is really happening in the region is clear evidence of something currently outside the reach of cryptocurrencies. The network and curiosity exist, but perhaps the political climate isn’t ideal for experimentation.